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L&M Companies, Inc. v. Unique Food Company, Inc.

United States District Court, E.D. North Carolina, Western Division

February 19, 2019

L&M COMPANIES, INC., a North Carolina corporation, and PALUMBO FOODS, LLC, Plaintiffs
v.
UNIQUE FOOD COMPANY, INC., LOUIS J. DEANGELIS, BEVERLY A. DEANGELIS, LOUIS J. DEANGELIS, JR., GINA D. BISSETTE, and BISSETTE BROTHERS, LLC, Defendants

          LAW OFFICE OF ROBERT E. GOLDMAN Special Appearance Counsel for Plaintiffs L&M Companies, Inc. and Palumbo Foods, LLC

          POYNER SPRUILL LLP Kevin Michael Ceglowski Local Civil Rule 83.1 Counsel for Plaintiffs L&M Companies, Inc. and Palumbo Foods, LLC

          MARTYN & ASSOCIATES Mark A. Amendola Special Appearance Counsel for C.H Robinson Worldwide, Inc.

          HENDRICK, BRYANT & NERHOOD, LLP Timothy Nerhood Local Civil Rule 83.1 Counsel for C.H Robinson Worldwide, Inc.

          McCARRON & DIESS Kate Ellis Md. Federal Bar No. 16373 Special Appearance Counsel for Lipman-Texas, LLC, The Thomas Colace Company, Inc., Nickey Gregory Company, LLC, JH Honeycutt & Sons, Inc., and Nature's Way Farms, Inc.

          NELSON MULLINS RILEY & SCARBOROUGH LLP Leslie Lane Mize North Carolina Bar No. 32790 Local Civil Rule 83.1 Counsel for Lipman-Texas, LLC, The Thomas Colace Company, Inc., Nickey Gregory Company, LLC, JH Honeycutt & Sons, Inc., and Nature's Way Farms, Inc.

          PARKER POE ADAMS & BERNSTEIN LLP Brian D. Darer Catherine G. Clodfelter Counsel for Defendants Unique Food Company, Inc. ("Unique''), Louis J. Deangelis, Beverly A. Deangelis, Louis J. Deangelis, Jr., Gina D. Bissette,, and Bissette Brothers, LLC

          AKERL Y LAW PLLC Bruce William Akerly Bruce William Akerly Special Appearance Counsel for Intervenor D&T Brokerage, Inc.

          MCANGUS GOUDELOCK & COURIE, PLLC Luke A. Dalton Local Civil Rule 83.1 Counsel for Intervenor D&T Brokerage, Inc.

          CONSENT INJUNCTION AND PACA CLAIMS PROCEDURE ORDER

          JAMES C. DEVER III UNITED STATES DISTRICT JUDGE.

         WHEREAS, on January 28, 2019, L&M Companies, Inc. and Palumbo Foods, LLC ("Plaintiffs") commenced the instant action against Defendants Unique Food Company, Inc. ("Unique"), Louis J. Deangelis, Beverly A. Deangelis, Louis J. Deangelis, Jr., Gina D. Bissette, and Bissette Brothers, LLC ("Bissette Bros.") ("Defendants") to enforce the trust provisions of Section 5 (c) of the Perishable Agricultural Commodities Act, 7 U.S.C. §499e(c) ("PACA").

         WHEREAS, on January 29, 2019, Plaintiffs filed their ex parte Motion for Temporary Restraining Order requesting, in part, that the assets of Defendant Unique be restrained. [Dkt. 8].

         WHEREAS, on February 8, 2019, this Court entered a Temporary Restraining Order on the ex parte motion of Plaintiffs restraining and enjoining the assets of Unique or its subsidiaries or related companies, among other relief [Dkt. 22].

         WHEREAS, on February 8, 2019, the Court granted the Unopposed Motion to Intervene filed by D&T Brokerage, Inc. ("D&T Brokerage") and D&T Brokerage filed its Complaint in Intervention on February 11, 2019 asserting claims under the PACA. [Dkts. 23 & 24].

         WHEREAS, on February 11, 2019, proposed Intervenor-Plaintiff C.H. Robinson Worldwide, Inc. ("C.H. Robinson") filed its Intervenor-Plaintiff C.H. Robinson Worldwide, Inc.'s Joinder in Original Plaintiffs' Motion for Preliminary Injunctive Relief [Dkt. 26] also asserting claims under the PACA.

         WHEREAS, Lipman-Texas, LLC, The Thomas Colace Company, Inc., Nickey Gregory Company, LLG, JH Honeycutt & Sons, Inc., and Nature's Way Farms, Inc. (the "Lipman Group") have advised that they also assert claims under PACA and participated in the negotiation and drafting of this Consent Injunction and PACA Claims Procedure Order. The Lipman group have or will request leave to intervene in this action.

         WHEREAS, Bissette Bros, is the owner of the real property having an address of 3731 Centurion Drive, Garner, NC 27529 and the following description

Being all of that certain tract land containing 2.336 acres (and designated as tract "2") as shown on the map thereof titled "LOT 2, CROSS WINDS INDUSTRIAL PARK" which map is recorded in Book of Maps 2007, Page 278 in the Wake County, North Carolina Register of Deeds Office, and being all of the property conveyed to Bissette Brothers, LLC, by that certain North Carolina General Warranty Deed dated August 28, 2012 and recorded in Book 014902 at Page 02648 in the Wake County, North Carolina Register of Deeds Office.

(the "Real Property") which is the subject of a pending sale and which Plaintiffs, D&T Brokerage, C.H. Robinson, the Lipman Group ("PACA, Claimants") assert may be subject to the trust provisions of PACA.

         WHEREAS, the trust provisions of PACA establish a statutory, non-segregated trust under which Defendants are required to hold all qualified trust assets including but not limited to inventory, proceeds, and accounts receivable in trust for qualified beneficiaries until full payment is made. 7 U.S.C. §499e(c)(2).

         WHEREAS, counsel for PACA Claimants, D&T Brokerage, C.H. Robinson, the Lipman Group ("PACA Claimants"), and Defendants have conferred and reached an agreement regarding the terms of this Consent Injunction (the "Order") to establish the manner in which the remaining assets of Unique will be liquidated and the rights, liens, claims and priorities determined as to these assets.

         WHEREAS, PACA Claimants and Defendants have agreed that the sale of the Real Property should proceed on the terms set forth herein.

         Accordingly, IT IS STIPULATED AND AGREED, by and between PACA Claimants and Defendants as follows:

A) Unique consents to the entry of an Injunction against it upon the terms reflected in this Order and any additional terms this Court deems necessary to give effect to this joint request for issuance of this Order.
B) Unique recognizes that PACA Claimants and other similarly situated unpaid suppliers of produce may be entitled to a beneficial interest in the single pool of Unique's PACA trust assets as defined by applicable law and regulation as perishable agricultural commodities received by Unique in all transactions, all inventories of food or other products derived from such perishable agricultural commodities, all receivables or proceeds from the sale of such commodities and food or products derived therefrom and assets commingled with, purchased with or otherwise acquired with such proceeds (the "PACA Trust Assets"). PACA Claimants reserve the right to assert that other assets of Unique and any affiliated entities should be considered or deemed to be included within the definition of PACA Trust Assets, including without limitation, non-produce related inventory, furniture, fixtures, equipment, vehicles, leases, real property, and leasehold improvements (the "FF&E"). PACA Claimants reserve all rights and claims in and to the assets of Unique and/or any proceeds realized therefrom, and also reserve the right to pursue their deficiency claims, if any, against the principals of Unique and potential transferees of PACA Trust Assets. Defendants reserve all rights, claims and defenses regarding the amount, validity, and PACA trust status of the claims of PACA Claimants or any other similarly situated PACA trust beneficiaries.
C) The parties agree that this Order is reasonable and necessary to provide a procedural framework for the orderly liquidation of Unique's PACA Trust Assets and FF&E, and to review, qualify and satisfy any and all claims against the PACA Trust Assets ("PACA Trust Claims"), to maximize the recovery for all unpaid beneficiaries of the PACA trust, and to ensure the rights of' all potential claimants are efficiently addressed in a single proceeding without the expense of administering multiple separate actions to enforce Unique's obligations to all potential PACA trust beneficiaries.
D) Defendants represent that Unique has insufficient cash or other assets from non-PACA trust sources, to the extent such non-PACA trust assets are determined to exist, to finance either the administration of the PACA trust or the marshalling and collection of Unique's assets for the benefit of its PACA trust beneficiaries.
E) This Order may be executed in any number of counterparts with the same effect as if all signatories had signed the same document. All counterparts must be construed ...

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